NSW Liberal powerbroker, boss and lobbyist Michael Photios has resigned as the leader of the party's dominant left faction, surprising even his close allies.
At a meeting on Saturday afternoon Mr Photios surprised factional colleagues by resigning his post as chairman of the board of the party's most dominant faction, the moderates also known as the left, Liberal sources confirmed.
Mr Photios received a standing ovation for his more than a decade in a post that carries considerable formal influence over party policy and preselections.
Combined with a stint in the faction's deputy leadership dating back to the 1980s, Mr Photios had three decades leading the moderate wing of the Liberals, during which time they rose from the bottom to the top of politics in Australia's largest state.
Mr Photios told friends he had been planning to take them by surprise and wanted to resign at the top of his political game, following the recent ascension of members of his faction to the Prime Minister's and Premier's jobs.
The move also comes as the role of lobbyists within the party has come under increasing scrutiny, particularly Mr Photios and his firm, Premier State, which enjoys large, $20,000-plus monthly retainers from major corporate clients including Telstra, the Hotels Association and The Star casino.
Former prime minister Tony Abbott told the ABC last year that lobbyists had too much control.
"If you are making money out of the people whose preselections you control or influence, there is obviously a potential for corruption," Mr Abbott said.
The NSW Liberals' state director, Chris Stone, wrote to lobbyists asking them to resign from the party's state conference, a policymaking forum, after that criticism was raised last August.
Mr Photios' decision also follows the ascension of leading moderate Gladys Berejiklian to the premiership of NSW last month.
Talkback radio king Alan Jones was among those who said Ms Berejiklian was too close to the party's behind-the-scenes operators, including Mr Photios.
In 2013 Mr Photios resigned from the ruling NSW Liberal state executive after then premier Barry O'Farrell passed an edict banning party officials from lobbying members of his government.
Mr Photios' role as the leader of the moderates will instead be assumed jointly by newly appointed Better Regulation Minister Matt Kean and Trent Zimmerman, the federal MP who won the right to succeed Joe Hockey in his northern Sydney seat.
The moderates, beaten into submission by the party's hard right last decade, have come to assume greater and greater supremacy within the Liberal Party and the largest single share of the votes on its ruling state executive.
"He's been the most successful chairman we've seen since the Greiner years," one senior moderate member said. "It will leave a huge hole."
Another source queried whether the faction's new leadership would be able to keep centrist and left-wing members recruited under Mr Photios together in one faction.
Mr Photios resigned from the NSW parliament after more than a decade in 1999. He served as Minister for Ethnic Affairs and Multiculturalism in the Fahey government.
